The National Association of Insurance Commissioners (NAIC) reported a 3% decline in average car insurance rates by state in 2007.
The report was compiled after a study done in all 50 states of America and the District of Columbia. Columbia has consistently held the top position as having the highest average car insurance rates by state since 2007.
Drivers in Washington D.C got some reprieve in 2007 when the average rate of insurance premiums was reported to have gone down by 2 percent. In the District of Columbia, average insurance rates stood at $1 139.82. New Jersey came in a close second at $1 103.53. This is 4% down from the previous year’s rates. Louisiana, New York and Florida followed closely, with two other states averaging over $1 000 premiums a year.
North Dakota had the least average car insurance rates by state in 2007, dropping by 3 percent to stand at $511.97. The other four states completing the bottom five are Iowa, South Dakota, Nebraska and Idaho. From these figures, it is clear that there is a correlation between rate of insurance and population density/traffic congestion. The more congested an area is, the higher the cost of insurance will be. This explains the wide disparity in price between the cheapest and most expensive states for a car owner to live in. Because of the fluctuating cost of the living standards in each state, it is very hard to compare insurance prices state by state.
Overall, the average cost of insurance fell by more than 21 percent to stand at under $800 per year. Different factors attribute to this: the increase in number of insurance companies ready to compete for the ever growing number of policy seekers and growth of the online market, previously untapped. Both of these led to increased competition, which saw insurance companies dropping their average car insurance rates by state in order to win clients. Consumers benefit the most from this development, because they can now spend less on auto insurance than ever before. As a car owner, you will get even lower rates if you do a thorough search and focus on comparison shopping before buying any auto insurance policy.
A major misconception some car owners have is that if the price is too low, then the policy probably offers little value. This is not necessarily true, as you can find quality insurance at very affordable rates. Choose your insurer carefully and you will enjoy not only low prices but also quality products and service delivery.